The new year smaller cos like Renault, Tata Motors going head to head with big boys

French carmaker Renault and homegrown Tata Motors seem set to play spoiler for the market leaders with the Kwid and Tiago, respectively, along with a series of products planned in the sub- Rs 10 lakh space.Lijee Philip&Ketan Thakkar | ET Bureau | Updated: June 08, 2017, 11:42 IST

They may be way ahead of the rest of the pack – and the leader miles ahead of the no. 2 – but automakers Maruti Suzuki and Hyundai would do well to keep an eye on new challengers.

French carmaker Renault and homegrown Tata Motors seem set to play spoiler for the market leaders with the Kwid and Tiago, respectively, along with a series of products planned in the sub- Rs 10 lakh space.

While Renault has gained a 10 per cent share in the mini-car segment, Tiago has been doing monthly sales of 4,500-5,000 units. Should this worry India’s largest carmaker, which has a market share of 47 per cent?

Not really, reckoned RC Bhargava, chairman of Maruti Suzuki. "Many of the auto players in India are a tenth of our volume (1.6 million units a year). We got here after years of continuous growth. India is indeed a very competitive market, with over 18 manufacturers. Successful companies will be those who understand customer needs and are able to design and provide solutions for them."

Bhargava conceded that Maruti’s market share may be slightly dented by the success of new models, but that isn’t unusual. Eventually, these products’ fortunes will depend on ease of maintenance and competitive cost of spares.

Maruti and Hyundai are gearing up to protect their mainstay of entry-level cars. The former has begun work on a locally-designed Alto codenamed Y1K and the Korean firm is working on an entry hatch called AH, which may give birth to a new Santro.New kids on the blockTata Motors, which till FY12 was India’s third-largest carmaker (it is now no. 5), has lined up the new Hexa for a January launch, followed by a sub-4 m sedan and SUV. It is pulling out all the stops to stem the decline in market share, having lost 9-10 percentage points in the past five to seven years.

This will certainly improve our position." On the other hand, Renault — which has one new product for India every year — more than doubled market share to 4.55 per cent in 2016. In 2018, it will plunge headlong into Maruti and Hyundai territory with three new models in the sub Rs 8 lakh bracket.

"We will look at bringing in innovative and game-changing products capable of creating a segment or sub-segment in India," said Sumit Sawhney, its India MD.

Renault will take the attack to the Hyundai premium SUV camp with its new Kaptur (a shift in focus from Kwid) and Duster phase 3 model while iconic brand Jeep’s Compass SUV will spice things up nicely.

Jeep, with strong local manufacturing, may even challenge Maruti Brezza, come 2018-19. Jeep has plans of introducing the Renegade B SUV and mini Renegade, a sub-4 metre SUV.